This study investigated the effect of binder level on the physicochemical changes and tabletability of acetaminophen (APAP)-hydroxypropyl cellulose (HPC) granulated using twin-screw melt granulation. Even at 5% HPC level, the tablet tensile strength achieved up to 3.5 MPa. A minimum of 10% HPC was required for the process robustness. However, 20% HPC led to tabletability loss, attributable to the high mechanical strength of APAP granules. The over-granulated APAP granules had thick connected HPC scaffold and low porosity. Consequently, these granules were so strong that they underwent a lower degree of fracture under compression and higher elastic recovery during decompression. HPC was enriched on the surface of APAP extrudates at all HPC levels. Amorphous APAP was also observed on the extrudate surface at 20% HPC level, and it recrystallized within 24 h storage. To achieve a robust process and optimal improvement in APAP tabletability, the preferred HPC level was 10 to 15%.